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Global Webinarfor Complementors
April 2024

Complementors TeamAgenda

1. Admin notices
2. Payment Experience – Alberto Barahona

3. Payment Pre-Validation – Mireia Guisado-Parra
4. ISO20022 – Marcos Cameron
5. Q&A

Admin notices

April 2024
Global Webinar forComplementors▪ This presentation is being recorded▪ The content will be published on swift.com (https://www.swift.com/standards/iso20022/iso-20022-past-webinars)▪ Global Webinar for Complementors occur the last Thursday of every month and you canregister 2 weeks before each event here: Global Webinar for Complementors▪ To ensure you receive communications from us while we remain GDPR compliant please
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informed about:▪ Global webinar for Complementors Invitations▪ Relevant developments on ISO 20022 and Transaction Management▪ Updates from Swift’s Market Practice team▪ The latest info on adoption enabling tools and support▪ Support requests / queries should be raised via the Support page

The Payment Experience
Alberto Barahona

April 2024
Confidentiality: RestrictedSwift market research: The findings

According to our own market research, more than 50% of people prefer a non-bank for international
payments. This project focuses on enabling Ease

April 2024
PaymentsExperience© Swift 2024
Confidentialand not for
onwardsharing.

Choosing apayments provider

What are the key drivers
to select a cross-border
payments provider?

44%

Security & trust

56%

Ease, speed &costfor those preferring a bankPrefer a bank forcross-border payments

Prefer a fintech or money transferoperator (MTO)% that would use their bank
if it matched the alternative
offering

76%
83%
of consumersof SMEs

for those preferring a fintech or MTO

Source: Swift end user research, n = 4,000+ consumers, 2,700+ SMEs in 8 countries (Australia, China, Germany, India, Saudi Arabia, South Africa, UK, US)(1) We share the vision of the G20 goals

The G20 has set targets for Retail payments to improve the cost, speed, transparency and accessof international payments.

April 2024Payments
Experience

Cost© Swift 2024
Confidential
and not for
onwardsharing.

Speed

Global average cost (fees & FX margin) < 1%No corridor with cost > 3%

75% of payments funds available in <1 hour
The rest within one business day

AccessEnd-users to have at least one option for sending
and receiving electronic payments

Transparency

All providers to share total transaction cost, expected
time to deliver funds, tracking of payment status andterms of service

How Swift can support toreach the Transparency goal

Our vision : to enable banks to raise the bar in Payments Experience- Provide the value of Essentials to our Community- Bootstrapping the technical use of the new API paradigm

April 2024

Bank-owned

PaymentsExperience© Swift 2024
Confidentialand not for
onwardsharing.

Exposing value to customers in the frontend with Swift products

Frontend
Transparency
on fees, FX,
amount andCustomers delivery date

Simplicity
Pre-fill fields

Certainty/
Peace of mind
Payment data is rightTransparency
No deducts

APIAPIAPI

API

SwiftRef

Pre-validation

Swift Gogpi tracker

Speed
In minutes

Traceability
Where is mymoney?

BackendBanks

Guidelines for atransparent, value
added payments
experience

Pre-processing

Processing

Post-processing

Data Services

Foundational Services

Data Services

25 Confirmed participants to the Proof Of Value + 15 in conversations
From different regions and sizes, and with different use cases and technical implementation

April 2024
Payments
Experience© Swift 2024
Confidentialand not for
onwardsharing.

More than 100 institutions have shown interest in the PX inititative

Payment eXperience material and resources:
Material and resources from Tech Enablement to the PX and PoV initiatives:➢ Sample code in different languages: Javascript, Python, SpringBoot, Quarkus and .NET
➢ Help developers get up and running faster with a particular language➢ Sample code can be used as Quick Start templates ofr any other Swift APIPayments➢ Swagger UI graphical interface used to visualize and interact with the API© Swift 2024
Confidentialand not for
onwardsharing.

➢ Code available at GitHub➢

Vulnerable dependencies fixed and patched automatically➢

Code always up to date with latest dependencias➢

Regression testing performed on every change➢ New developer portal content, build by developers for developers➢ Mobile App Prototype, developing use cases and possible flows➢ Video of the Mobile App showing the features and uses
➢ New test cases in sandbox and Postman collections

PoVExperience

Self Adoption

April 2024

➢ Named Swift Solution Architects and API Experts to Support adoption of the APIs by each participant➢ Link between Swift members and Complementors, and other initiatives being run in parallel looking foraccelerating and maximizing the benefits of the PX PoVOur vision: Mobile App Prototype

1

Transparency guidelines

2 Pre-filling and validating data3

Exposing payment status

April 2024
Payments
Experience
Example from adummy bank

© Swift 2024
Confidential
and not for
onwardsharing.

Swift does notintend to create astandalone App

Validated via
pre-validation
APIExposed via
gpi tracker
API

Prefilled via
SwiftRef API

Note: Regulatory assessment to be conducted, actions resulting from it to be evaluated at a later stage.

Our vision: Mobile App Prototype

April 2024
Payments
Experience© Swift 2024
Confidential
and not for
onwardsharing.

Note: Regulatory assessment to be conducted, actions resulting from it to be evaluated at a later stage.

Payment Pre-Validation
Mireia Guisado-Parra

April 2024Confidentiality: Restricted

Page 13

The current reality

2024
Payment
pre-validation
explained

Payment
instruction

DebtorDebtor
agent

Swift

Uncertainty
Will the creditor receive
the funds without delays?

Creditor
agent

Creditor

Page 14

The current reality
Industry cost and impact

2024
Payment
pre-validation
explained

Payment
instruction

DebtorDebtoragent

Creditor
agent

Swift

Creditor

Rejection
More than 5% of paymenttransactions are non-STP

This friction costs the industry around 2B EUR annuallyand represents more than 35 million payment transactions.

Payment delays can take days to resolve at creditor,
but also debtor, side and can result in late fees.

The cost to handle a single non-STP payment is in theorder of 50-100 EUR.

Handling issues (/repair costs) are often expensive
manual processes to run and maintain.

Page 15

2024
Payment
pre-validation
explained

The current reality
Understanding this friction

Rejected payments typically have incorrect account details,
identifiers and codes
Debtor agent can be unaware of local market practices
at the destination
Swift’s added value services can help the industry remove friction
upfront by prefilling and validating upfront payment dataPage 16

2024
Payment
pre-validation
explained

A trusted capability
Identifying potential friction up front

Page 17

What is Swift’s payment pre-validation service

12024
Payment
pre-validation
explained

Payment

pre-validation2

DebtorDebtoragent

Payment
instruction

Swift

Creditor
agent

Payment instruction(preparation in progress)

1

LIVE
Beneficiary account verification (BAV)

Collaborative service

Central BAV
Validate payment purpose code
Validate account format
Validate financial institution identifier
Verify payment eligibility (SwiftGo)….

Central services

Creditor

Page 18

Collaborative service
Beneficiary Account Verification (BAV)12024
Payment
pre-validation
explained

Payment

pre-validation2

Debtor1

Debtoragent

Payment

Creditor
agent

instruction

Swift

Beneficiary Account Verification: Can you, the creditor agent, check if this account is able to receive funds?
Optionally and dependent on the Data provider: Can you also check if this name matches this account?

APIrequestAPI
response

Debtoragent(API consumer)

Swift(API gateway)

Creditoragent(Data provider)

Creditor

Page 19

Central service
Central Beneficiary Account Verification (CBAV)

12024
Payment
pre-validation
explained

Payment

pre-validation
2Debtor1

Debtoragent

Payment

Creditor
agent

instruction

Swift

Central Beneficiary Account Verification: Can you, Swift, check if this account is able to receive funds?

API
requestAPI
response

Debtoragent(API consumer)*Traffic from the whole community except those located in: AT, IT, CH

Swift(API gateway)

Swift traffic*
statistics

Creditor

Page 20

2024
Payment
pre-validation
explained

Overview of available central services

Central beneficiary
account verification:

Validate payment
purpose code:

Validate payment
purpose:

Validate amount:

Can you, Swift, check if thisaccount is able to receive
funds?

Is the payment purpose code
present? If it is, does the code
match one of the expectedvalues? If it is not present, thenit returns a list of valid codes

Is the payment purpose code
present? If it is, does the code
match one of the expectedvalues and the description theexpected format? If both thecode and the description areabsent, then it returns a list ofvalid codes

Validate accountformat:Validate category
purpose:

Validate instructed
institution:

Validate SwiftGo
eligibility:

Does the account format (fromIBAN to domestic, bank-specificformat) match the expected
formatting?

Is the payment category
purpose required, and if it is,does the purpose match oneof the expected values?

Is the instructed institution (BICor Clearing System Member ID)
registered in SwiftRef as afinancial institution?

Does the payment satisfy theSwiftGo Rulebook eligibility
requirements? If it does, then it
returns payment predictability
informationIs the amount in line withcurrency number of decimals
and in line with the payment
MI specific amount limits?

Page 212024
Payment prevalidation
explained

Adoption numbers, including BAV and CBAV service coverage

297
Banking groups
subscribed

Service coverage
DataCentralproviders BAV

50+

83%

Banks Implementing

81
1663,8%54,2%Live banks

Data providers live
HSBC, DB, Unicredit,…

9,6%

Live
Potential, with all signed banking groups

Page 222024
Payment
pre-validation
explained

Payment pre-validation
Key points

Friction creates risks to manage
due to lowered predictabilityof an account receiving funds

Swift’s payment pre-validation
API services can address 65%of payment rejection root causes

Swift is continuously looking
to enhance the service by• A payment may not be creditedon time, potentially incurring
late fees

There are two main types ofpre-validation:• Expanding the numberof validators• Central validation driven by
Swift managed datasources• Improving the quality of thevalidation results• A creditor agent may need toresolve issues with the payment,same for a debtor agent but(days) later• Handling issues are often
expensive manual processes
to run and maintain• Data-provider collaborative
validation driven by
creditor/beneficiary banks

ISO20022
Marcos Cameron

April 2024
Confidentiality: Restricted

Last MonthHighlights on CBPR+

March 1st, 2024 – March 31st, 2024

Total Receiver
BIC8s:

Total Sending
Countries:

1050+ BIC8s
sending domestic
or international
ISO 20022
messages on
FINplus service
globally

5450+ BIC8s
receiving domestic
or international
ISO 20022
messages on
FINplus service
globally125+ countries
sending ISO20022 messageson FINplus service

Total ReceivingCountries:
200+ countries
receiving ISO
20022 messageson FINplus service

Adoption Rate:
20.3% of payment
instructions traffic
has already shiftedfrom FIN to ISO
20022 messages(pacs.002,pacs.004,pacs.008, pacs.009

20.3%

200+& pacs.009Cov)

125+

5450+

Daily Average of850,000+ ISO
20022 payment
instructions aresent and received
on FINplus service
globallyTotal Sender
BIC8s:

1050+

Average Daily
ISO:

850,000+

April 2024

Page 25

June 2024

ISO 20022 migration update
Continued community effort

Swift will continue working towards a successful end to the coexistence period in November 2025, and callson community members also to play their part.

Swift Information Report IR 894 :COMMUNITYENGAGEMENTCORPORATES AND
PAYMENTS EXPERIENCEINITIATIVESVENDORS AND
PARTNERS•

Continued engagement with Top 175 customers torefine adoption forecast•

Global community engagement campaign andtrainings•

Mandatory renewal of ISO 20022 Vendors SelfAttestation in Q1 2024•

Any commercial changes will be communicated inadvance and will be phased in H2/2024 or 2025

SERVICES & SUPPORTCOMMERCIAL
INCENTIVES ANDDISINCENTIVESPRODUCTENHANCEMENTS

Page 26

June 2024

Community engagement update
Bilateral engagement with key payments players

Customer consultations to create visibility on planned adoption for next 2 years
Q4 20232024

Key takeaways• Well-defined project for larger banks• Significant ramp-up of pacs messages expected in 2024
• Mid-sized banks expected to migrate mostly into 2025
• Most working towards native adoption

Continue regular bilateral engagement throughout coexistence to• Monitor progress against adoption forecast for payment origination flows• Capture adoption plans for other dimensions like statements, rich data, …
• Assist banks to anticipate growth in adoption from correspondents• Gather feedback and suggestions on any aspect of the migration

Nov 2025

Page 27

CBPR+ release of November 2024 – Deployment plan

15 Dec 2023
Q4 2023

Initial Usage
Guidelines
published on
MyStandards

3 May 2024

19 July 2024

16 Nov 2024

Deployedin FINplus
ITB Future

Deployedin FINplus
Pilot
FutureGenerally
available inFINplus Live andPilot Current

31 Mar 2024

Final Usage
Guidelines
published on
MyStandardsVendor Testing on ITB
Customer Testing on Pilot

Following will be published along with thefinal Usage Guidelines:• CBPR+ User Handbook SR 2024

Scope
camt.105.001.02

ChargesPaymentNotification

MT 190 /MT 290In-flow

camt.105.001.02

ChargesPaymentNotification_MultipleCharges

MT 190 /MT 290-camt.106.001.02

ChargesPaymentRequest

MT 191 /MT 291

In-flow

camt.106.001.02

ChargesPaymentRequest_MultipleCharges

MT 191 /MT 291-• MX/MT equivalence table
Readiness portals:• Readiness Portal• Vendor Readiness Portal

Please note that there are 2 Usage Guidelines for camt.105 and camt.106 each as
shown in the table above. In-flow translation will NOT be available for a multiple charges
UGs for camt.105 and camt.106.

Page 28

How to dive further: ISO 20022 for Financial Institutions – Support Page

September2023

One-stop shop for all technical specifications
Protected, requires swift.com login•

Readiness Documentation•

Product Documentation•

Learning resources•

Top Knowledge Base Articles•

And much more …

Page 29

March 2024
Global Webinar forComplementors

QuestionsIf you have any questions, please contact your Account Manager
or raise a case via the Support page